Just returned from the USA – My Report

And your last paragraph Steve was exactly why we persisted so long to get the story told. You could not have done better with your research. An you did it without joining fees, VIP tours, Inventory inspections, in house finance and all the other accoutrements designed to trap the ‘astute invetsor’.

Well Done!!

Hi All,

I'm fairly new to this site but have taken interested in the many forums and posts on Australian's purchasing IP's in the US.

I can see the good opportunities, and my query is: has anyone sold any of their IP's over there or had any issues with selling in the US ?
 
Are there any other issues, i.e capital gains tax. etc  ?

One question I had to answer on my visit was.. how long did I think it would take for property values to begin appreciating. Even after looking at close to 50 properties across the market spectrum I still have no idea. All I can say is that in my opinion an investment in the market at this stage is a cash-flow play.

I gave up on trying to figure that one out after 2010.  They have in my area about 5,000 to 10,000 and at least 30,000 in the markets I used to buy in FL.  The cash flow is the best part, that's all I'm counting on and anything else is a bonus. 

So why in gods name are you attempting to flog your lack of experience to others? This is exactly the type of operation that makes me very nervous. I used to be open minded until I saw first hand exactly how this can end in tears.

Steve (above) went and spent time with someone who clearly knew what they were doing and had basically spent their entire lives in the same area. I've done OK in RE in the US but the only reason I have done that is because (like Steve) I went out and found an expert I felt (for whatever reason) comfortable with. Pre internet that was very difficult and time consuming to do, but the work I put in was worth it.

I have no issue with you (or anyone else) going to the US armed with a US Property Power Pack written by an Australian with only a smattering of understanding of the US market and having a go yourself, but to foist that inexperience on others and use that inexperience to sell a product I do have issues with. The only thing that makes me at all comfortable with what your website says is that you (unlike a LOT of others) do make it clear you have no experience to speak of at all.

I am sure you are nice people, but I only looked at your website because your posts conveyed a total lack of experience and understanding. Unfortunately your website merely confirmed this. You can make good money investing for yourself, but please avoid involving your advice/inexperience and other people's money – I can all but guarantee tears and suffering….

Great post Steve,

If I was to buy through any BA it would prob be Alex. I believe he is doing some great stuff in Charlotte.

Engelo

Quickchick,
Nor do I have any interest in a public slanging match with yet another USproperty company as I have been quite busy enough trying to help people see some of the more obvious scams for exactly what they are.
I congratulate you on getting an E2, it puts you a long way above most other operators, but the facts as they seem to be are that you have flipped 2 properties in the US and have read (probably devoured) Steve's US Property Power Pack thingy. You do live in the US (now) and visted 3 times in 2011. Your site appears to require registration which I assume will give you no more information than you could gleen from the net in Australia. One of the properties you show before and after photo's of looks to me suspicously like a mobile (I say suspciously because I may be wrong) – something Steve also portays as examples in his USA PP thingy, but a clear danger sign for those who know. All around it just doesn't engender confidence in me at all. Add to that something I see a major red flag with –  'the property is in the name of the clients LLC'. It is appreciated that you are pointing out you are not buying directly from some flippers Aladdins Cave, but I have to assume from that comment you yourselves have no US real estate qualifications whatsoever and are merely putting people (valued clients?) in touch with businesses that are licenced?

I am particularly drawn to this comment which (aside from you appearing legally unqualified) I think goes to the heart of my concerns:

"………..Our connections can save people time (how long does it take to arrive in a new city and meet competent rehab people?)….."

The answer to that question I would measure in years!!  

With any of this US property stuff, the big problem is management and that does not even appear to be touched upon – understandably because you have explained quite well you do not have any experience whatsoever in that as yet.

Again I say I applaud what you are personally setting out to do, but despite you no doubt being very nice people I stand by my comments above and suggest you learn about what it is you are doing yourselves before you try to 'assist' others. That may sound harsh, but if you are setting out to do the right thing, paying regard to a comment like that I can all but promise you will save you weeks of sleepless nights while you worry about the spot fires your inexperience will have created. At least, I hope you would lie awake at night worrying – most do not I am sure.

Being positive for a final note, you are living there and are allowed to work there without having to decamp for 'visa runs'. I also note with some optimism that you are not Andrew Allan and don't seem to be related to Trent Richards. So good so far:)

PS: Very depressingly, my US agent is as far from being female as it is possible to be and even if I was extremely drunk would never appear good looking enough to even suggest anything other than being a middle aged guy:(

PPS: Your comment 'Let me start by saying, I think it's great that you have invested leveraging off someone else's knowledge. A wise move, as many will agree…', Let me finish by saying:) the only thing I leveraged off was the experience of a _qualified and licenced US Realtor_ which is what I strongly suggest everyone does. In short I found an agent I liked and who was prepared to deal with a foreigner and bought properties they had listed, just like anyone else could do. No inexperienced middle man/woman involved anywhere:) 

 On the topic of local knowledge, as an Australian I probably undervalued this when looking into the US market. At home no real consideration is given to house values based on the proportion of home owners in a particular street. In Australia house prices all tend to trend the same in a particular area. However, in the US the same house could be worth 50% less just one street away, and as foreclosures mount home some home owner neighborhoods are now turning into rental neighborhoods. I looked at a number of estates built in 2000-2006, where the developer in conjunction with a low doc lender turned many prior renters into homeowners. Steve thanks for the kind words.  To continue on what you're saying, this is where most USA and Australian resellers will disagree with me. The  newer homes built 2000 and above are still going to be in rental areas down the road, which is when you will start to see numerous foreclosures in the same area. We are now taking this area that was retail and making it rental. So the value years from now, how will this appreciate?  You are 100 % correct. These are mostly track homes in states like NC, SC , Florida , Atlanta and a few other markets.  I showed you the Streator house; very nice home and area. Actually scheduled to close may 8th on that one. ( damn banks can't get things done as fast as I want them to ) Same area, less than three blocks away you saw what I was talking about. Seems the areas are imploding from the outside in.  So to me, cash flow is really all we are looking at.  Walking in and saying we have equity or future appreciation; I just do not see it. I am sure I am going against what everyone else is saying, and selling. I could be 100 % wrong, but what you pay is what the property is worth. Equity: go to a bank and tell them you want to pull that Equity out of the property. LOL Good Luck looks great on paper, but come one.

Foreclosures are now reversing that process, these estates are gradually turning into rental neighborhoods. Not that that is a bad thing, from an investors point of view, these are beautiful modern solid houses, which will always rent easily. It is just that you have to understand how to correctly value them. Again, I am glad you took the time to drive around with me. I hope you called the other Realtor and rental signs ( numbers in those areas). This is such a great way to see if some one is full of it or if they really are feeding you a line of (C____P). That being said, we are looking for a nicer product than what you saw. Jay was the first one to point me in that direction, as well as a few others. I do appreciate the compliments, but companies like mine are learning from companies like Jay's.

My reason for giving Jay credit:  Quite a few things to be honest since he has changed a lot of my ways of thinking in this business. Real estate is a business which most seem to forget.

1: Lower end rehabs: He showed me a better, more efficient way to do the rehab( Jay do you know how many sewer lines just went on us)

2: Made me think about the nicer end product which potentially could justify ( equity and future appreciation ) less of these
    types of homes around. These are more of the 2000 sq ft and larger homes must be built 2000 and above. Looking for 4
    bedroom 3 bath or 3 bed 2 and half bath. I believe Emma made the comment about homes 2000 sqft and above homes.

3:  The buy and hold we are going to be selling less homes,  working on a module similar to TWH, but raising capital as long  
      term partners paying the loan and holding  for long term.

4: Building new homes and town homes ( 4 bed 2 bath with half bath) Jay was building some nice homes and had some
   good things. So I am learning quick  to take advantage of capital that is out their.

. Another interesting thing I discovered about myself while I was in the USA, and that is I did not know how to act around black people. Honestly I was a bit scared of them. Fortunately I discovered that I was an idiot, and I really enjoyed talking to those I met.   LOL So all black people are not rappers or pro football players.

One question I had to answer on my visit was.. how long did I think it would take for property values to begin appreciating. Even after looking at close to 50 properties across the market spectrum I still have no idea. All I can say is that in my opinion an investment in the market at this stage is a cash-flow play. I agree 100 %.  We are looking for the properties that are priced for resell from $125k to $180k with rental being about 1 % . To me this could be the equity and future appreciation spread. Not trying to contradict myself with the equity comment.

 While I was in the USA the 7.30 report on USA property scams was aired. I watched it from my hotel room. My initial reaction was OMG what am I doing here. But when I really looked closely at it I could see that it was not criticizing that value of investing in US properties but instead was a cautionary tale about dealing with overseas promoters who inflate the price of these properties and sell them to unwary investors with no regard to the soundness of the investment.  Watch now most of the resellers will now base the properties not on cash flow, but future appreciation. Just had this conversation today with a USA reseller and I now see the signs of  warning for  the USA or international  resellers to be careful .  Jay, you again already predicted the SEC and securities involved in the selling, collecting fees as unlicensed agents.  Hearing the rumbling now and the 7.30 report Great that ( Emma and Jeremy ) did that was also brought to my attention.

So yes I will be investing in properties in the USA. But I will only work with local experts in the areas I choose. While Zillow is a great resource I won't be buying from it. Zillow is good but again, no one is going to be an expert in all areas. I am still learning about Charlotte area as it changes . I think people should look at investing with teams and two key factors for teams. Jay has been in this game since I was kid so his know how and understanding of real estate  is going to be way more than mine. For someone like me, local product is the only thing  that I can offer assistance on but no one is perfect or going to be 100 % correct. No different then Cheeves , Kyler , and Emma sorry there are others who offer some solid advice.  but Steve [/quote]

@ Mihova

the link above got deleted, admin must have not liked all the advertising

Hi jay,

I’m only new to the site but may be moving to Washington State in the next 6 to 12 months. I would love to seek your advice on property (both buying a home and IP’s) if you would be willing to educate a beginner some time.